Singapore organization to take over Thai telecom giant

The chief executive of Singapore's Temasek Holdings, Ho Ching, is to appear at a news conference next Monday to announce the takeover of Shin Corp Plc, the telecom giant founded by Thai Prime Minister Thaksin Shinawatra, according to a telecom industry source.

Ho made a one-day trip to Thailand Thursday to add a final touch to her organization's imminent takeover of the Thai conglomerate. Despite her Monday date with the media, the deal is expected to be notified to the Stock Exchange of Thailand (SET) Friday.

A source in Singapore on Friday was quoted by the Bangkok Post as saying that Ho had traveled to Bangkok Thursday and returned on the same day.

Regarded as one of Asia's most influential women, Ho is the wife of Singapore Prime Minister Lee Hsien Loong. She is in charge of Temasek, which is the investment agency of the Singapore government. According to Temasek Review 2005, the company commanded an investment portfolio totaling 62 billion US dollars last year, up 15 percent from the previous year.

According to the source, Temasek plans to acquire 49.6 percent of Shin Corp's shares from the Shinawatra families, making the 70. 8-billion-Baht (about 1.77 billion US dollars) takeover the largest deal in Thai corporate history.

Sources said Temasek and Shin Corp have agreed on a final price of about 51 Baht (1.3 US dollars) per share. Shin Corp has 3 billion outstanding shares.

The recent strengthening of the baht against the US dollar has been attributed to the huge amount of foreign capital flowing into Thailand ahead of the takeover transaction, the central bank said Thursday.

Bank of Thailand Governor Pridiyathorn Devakula said the baht's appreciation to a nine-month high of 39.4 Baht to one dollar was due mainly to the inflow of foreign capital for the purchase of Shin shares, Thai newspaper the Nation said on Friday.

Temasek's buy-out of Shin Corp is part of its investment expansion into Asia. Its wealth increased by 338 million US dollars in the financial year ending March 31, 2005, including 104 million US dollars from direct investments. The latter was driven by the portfolio shift into Asia.

Temasek's investments span from telecom and media to financial services, property, and transportation and logistics.

Shin's businesses include Thailand's largest cell-phone operator, Advanced Info Service Plc (AIS), the satellite operator, Shin Satellite Plc, the free TV station, iTV Plc, the budget airline, Thai AirAsia, and the personal loan provider, Capital OK.

Temasek has more than a 60 percent stake in Singapore Telecom, which owns almost 20 percent of AIS. The takeover of Shin Corp will make Temasek and SingTel the largest shareholders in AIS, which is the cash cow of Shin Corp.

Thaksin has been quoted as telling his executives that his family will sell off Shin Corp as part of an exit strategy to end criticism of him and his family for having conflicts of interest.

Source: Xinhua